Comprehensive 2012 Landmark Child Identity Fraud Survey Report Conducted by Javelin Strategy & Research Shows the Crime Often Occurs Close to Home

CHANTILLY, Va., Dec. 4, 2012 /PRNewswire/ -- Today, Intersections Inc. (NASDAQ: INTX) and ITAC, the Identity Theft Assistance Center, released the findings from the 2012 Child Identity Fraud Survey Report conducted by Javelin Strategy & Research. This report takes a deeper look into the crime of child identity theft identifying trends and also exploring the long-term impact this crime can have on children and their families. Specifically, the report found that one in 40 households surveyed had at least one child whose personal information had been compromised by identity criminals and that criminals frequently create synthetic identities to commit these crimes.

"In the past two years, we've seen the issue of child identity theft garner media and consumer attention, but there are many misunderstandings about this crime and more work needs to be done to educate consumers," said Steve Schwartz, President, Partner Services at Intersections Inc. "Reputable studies like this one can help the industry better understand the threats associated with child identity fraud, and in turn help educate families about how to help protect minors and recover from the crime, ensuring a healthy financial start upon reaching adulthood."

Key Findings

One in 40 Respondents had a Child who was a Victim of ID Fraud.According to the study's findings, the incident rate of child identity fraud among households with dependents under age 18 is 2.5 percent over the lifetime of the family, or one in 40. This number may be underreported due to the prevalence of family members who may be linked to the crime and would not admit to the fraud, as well as households where victims do not discover their childhood ID fraud until they reach age 18.

Victimization Frequently Occurs Close to Home by Family or Friends.Friendly fraud is to blame in many child ID theft cases, and the data shows that 27 percent of victims reported knowing the individual responsible for the crime.

A Social Security Number Is the Top Compromised Identifier.Consistent withindustry experience, and like adult identity fraud, the study shows that Social Security numbers are the most commonly used piece of information by identity thieves targeting children. Criminals actively seek children's Social Security numbers (SSNs) to create a "Synthetic ID," which can be used to commit financial fraud. In fact, 56 percent of respondents reported theft or misuse of a child's SSN. In fact, 56 percent of victims reported theft or misuse of a child's SSN.

Synthetic Identities Most Common Method of Child ID Fraud.The study shows that the most common way that criminals use a child's personal information is to combine a child's Social Security number with a different date of birth to create a fabricated identity that can be used to commit fraud. Synthetic identities are very difficult to detect.

Child Identity Fraud Difficult to Detect and Resolve.The survey showed that these crimes took 334 days to detect and 44 hours to resolve, and 17 percent of children were victimized for a year or longer. These statistics indicate that child identity fraud is both difficult to detect, and difficult to resolve.

"This survey provides the first solid, verifiable statistics on the causes and consequences of child identity fraud," said ITAC President Anne Wallace. "The results will help ITAC and its government and nonprofit partners improve strategies to prevent and detect child identity fraud and assist victims recover from the crime."

Insight and Recommendations

Increasing awareness and education among parents and children is a key component to preventing child identity theft. The findings in this study underscore the important role that parents must take to protect their child's identity.

Ask Why Before Giving Personal Identifying Information. Before providing your child's SSN or birth certificate, feel empowered to ask why the information is needed and how it will be protected. If asked for a child's SSN, ask these three questions: Why is it needed? Isn't there another way to identify my child? How will my child's information be protected?

Share Safety Tips. Share knowledge with children and remind them to keep their information private. Children may be asked to answer questions about themselves on the first day of school, but remind them that personal information like their home address, phone number, or social security numbers should not be shared with anyone.

Read all Materials Sent to Your Child. Items received through the mail or e-mail asking for personal information can give hints into criminal activity that may be occurring. Keep an eye on terms like "personally identifiable information," and "opt out." Make sure to find out how a child's personal information will be used, whether it will be shared, and with whom, before granting access.

"Javelin has focused on adult identity fraud for many years, and we are pleased to be able to explore this emerging area of child identity fraud to better understand the issue and inform the public," said Jim Van Dyke, president and founder of Javelin Strategy & Research. "The history of consumer advocacy and education on the part of our sponsors speaks to their commitment to relevant research and dedicated to widening the awareness of this growing crime."

Methodology

The Javelin Strategy & Research Child Identity Fraud Survey Report is the first of its kind to examine child identity fraud, and the survey results are based on responses from more than 5,100 U.S. households with dependents under age 18 on KnowledgePanel®U.S.

Intersections Inc. (Nasdaq: INTX) is a leading provider of consumer and corporate identity risk management services. Intersections provides various levels of service to more than 8.2 million consumers. Those services are offered through North America's leading financial institutions, directly to consumers under Intersections' award-winning Identity Guard® brand (http://www.identityguard.com), and through the company's exclusive partnership with ITAC, the Identity Theft Assistance Center. Since 1996, Intersections has protected the identities of more than 35 million consumers.

About ITAC

ITAC, the Identity Theft Assistance Center, is the national advocate for identity theft victims and a leading voice on identity policy. Millions of consumers have access to the ITAC victim assistance service through our members – the financial services companies who support ITAC and offer it as a free service for their customers. ITAC is dedicated to protecting all consumers through education, research and the criminal prosecution of identity crime. http://www.identitytheftassistance.org/

About Javelin Strategy & Research

Javelin Strategy & Research is the leading provider of quantitative and qualitative research focused on the global financial services industry. Our extensive quantitative data and deep analyst experience enable us to forecast the direction of the financial services market and make recommendations that empower you and your business to succeed. For more information on this project or other Javelin studies, visit www.javelinstrategy.com/research.